Thanks very much, Brecciaboy, for all the good context you’re giving us! For those who might be wondering, I went back to prior news releases and confirmed that management told us about the 5,000.00 added value and the 100 tons per day facility BB cited. It’s pretty clear to me this company is going into production - eventually, it only being a matter of time. I think I have plenty of that (at least I hope I do).
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Longest one yet? Don’t have the time. Give me an executive summary please.
TDK
What ever happened to Mike Gold?
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AUMC’s management knows exactly what they have and knows what to do to maximize profit. 
Continue to Be Patient!
EZ
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What I appreciate from the updates is that they continue to include a piece about returning value to the shareholders. I think they will definitely be doing cash dividends, especially given that is how MC turns his investment into personal cashflow. I know its important to reinvest capital to advance the property but we are in much need of a few rounds of dividends to recalibrate the stock price first, imo.
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Oh he is still doing his naked run with his goat cheese in the fridge! lol
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I enjoy reading BB’s more expansive posts — the more details regarding potential angles, the better our own good judgment to gauge for ourselves. Reading is Fundamental 
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100% for sure on the dividends - and I think it’s clear we will go into production.
If we get to .01, I will have made a nice profit. Thank God for “chasing my tail”! Maybe.
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Good for you if you make a profit at .01. The majority here I believe the max they get their money back is .02 or above let alone any profit. People were/are reluctant to purchase shares at sub-penny especially what we have gone through. But as the saying goes big risk big reward.
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Yeah, admittedly I was a little “aggressive” (read mentally unstable … maybe).
If my wife knew, I might end up in traction for the next 3 months right alongside Brecciaboy - but at least I’d get some free entertainment.
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Maybe we could resurrect Doc’s tank.
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Somebody is quietly loading up at 2 million share increments at a price target at .001 this is any ones guess why but this could be a long hold for years to come unless they believe something is in the works.
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Do I recall some increased volume last Friday too?
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Probably Bald Eagle - that’s my guess. It being clear from MC that the company will go into production, it’s gotta be a good gamble that this stock will go to .01 at least - and that’s a 10-bagger from here!
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Hi JimmyP,
Your post was bang on as far as the need to “recalibrate the share price” via cash dividends. For me, the concept of “DISCONNECTS” is fascinating and it ties directly into the concept of “POSITIVE FEEDBACK CYCLES”. More about that in a moment. In the case of Auryn/Medinah, I could list a dozen positive accomplishments that have been made semi-recently that only ended up in the down-ticking in the share price. This is despite the fact that the GRADES Auryn is experiencing are literally through the roof and the price of gold is trading at near all-time highs. The saying in this industry is that “GRADE IS EVERYTHING”.
Here’s a brief summary of the assay results from the DL2 Vein over time (from a benchmarking point of view, the average grade being mined worldwide in similar underground vein projects is 4.18 gpt gold): the artisanal miners averaged 64 gpt gold, Auryn did a series of channel samples in the “old works” (levels 0,1, and 2) that averaged 85 gpt gold, Auryn did 12 channel samples at just below the intersection of “Shaft A” and level 2 averaging 154 gpt gold, after intersecting the DL2 Vein with the Antonino Adit, Auryn did 2 groups of channel sampling assays, the first group of 4 separate channel samples came in at an average of 164 gpt gold, the second came in at 150 gpt gold. Auryn then ran 2 separate tests to determine the amenability of the DL2 Vein ore to the smelting process, the smelting test done at the Enami smelters came in at an average of 70 gpt “gold equivalent”, the second one done in Lima, Peru at the Plenge Lab, came in at 128 gpt gold. Suffice it to say that the grades of the DL2 Vein have been CONSISTENTLY through the roof.
It’s like there is a store of POTENTIAL ENERGY constantly building up, but the transmission mechanism between POTENTIAL ENERGY and KINETIC ENERGY (in this case share price performance) is missing. It’s as if the CORPORATE ACCOMPLISHMENTS gear is spinning round and round nicely but the SHARE PRICE gear hasn’t engaged with the CORPORATE ACCOMPLISHMENTS gear as if somebody’s got their foot on the clutch. I think that some of us have the sensation that once those 2 gears do mesh, the share price is going to “burn some rubber”, but it never seems to happen.
Just how far out of whack, can a DISCONNECT between CORPORATE ACCOMPLISHMENTS, GRADES, and SHARE PRICES grow to? Maurizio is a very bright guy and he’s accomplished a lot in the business world. He knows exactly what is going on behind the scenes. Not that long ago, he and his colleagues were buying huge blocks of shares of Medinah, out of the open market, at 100-TIMES the current share price ($0.08 versus $0.0008) back when the list of CORPORATE ACCOMPLISHMENTS, in regards to the progress being made at the ADL Mining District, was nowhere near where it is today. Again, it makes no sense.
Back then, we had a pretty good idea that the historical production grades at the DL2 Vein were OUTSTANDING. The records of Enami and SERNAGEOMIN, carefully archived the 64 gpt gold average that the artisanal miners achieved over a 30-year timespan from 1940 to 1970. The total production involved was about 2,000 tonnes. This is not a huge number, but it is a very significant “SAMPLE SIZE”, from the point of view of being a “representative” sample.
Recent results have not only corroborated these grades but actually they greatly exceeded those results. And yet, very smart investors were paying 100-times as much for Medinah shares back then, as they are worth today, despite the obvious recent progress and the further corroboration of the stellar grades. That is a world class DISCONNECT. When you factor in what Les Price was doing way back then, I’d bring that ratio down to 50-to-1. The price of gold back then, when Maurizio and his colleagues (“the SMART MONEY”) were paying those multiples of current share prices, was about $400 less per ounce than it is today and the proximity to EXTREMELY HIGH-GRADE GOLD production was nowhere near where it is today. In fact, Auryn had been “mining and stockpiling” extremely high-grade ore for over 200 days recently until they temporarily paused operations.
The question then becomes, how do you unleash all of that pent-up POTENTIAL ENERGY and convert that into SHARE PRICE ENHANCEMENT. The answer, like JimmyP suggested, is CASH DIVIDENDS. Generating EARNINGS and creating the ability to declare and distribute CASH DIVIDENDS, is a very honest endeavor. You can’t fake EARNINGS and more importantly EARNINGS PER SHARE. Cash dividends provide the means to RECONNECT pre-existing DISCONNECTS. As far as the OVER-THE-COUNTER markets in the U.S. go, share prices and CORPORATE ADVANCEMENTS can become incredibly DISCONNECTED, even without market manipulations by outsiders.
WHERE DO “POSITIVE FEEDBACK CYCLES” FACTOR IN?
There is nothing more powerful or predictable on this planet, than POSITIVE FEEDBACK CYCLES that are self-sustaining. The junior gold producers are a great example. Once into production, the appearance of a variety of “production bottlenecks” are inevitable. Thankfully, they are usually easy to diagnose and address. This allows the PRODUCTION RATE to predictably increase with time. I would assume that Auryn’s PRODUCTION RATE will increase in a “stair-step” fashion as the “sub levels” under level 3 go into production. This increase in the PRODUCTION RATE then increases the amount of EARNINGS generated which then allows management to deploy some of those earnings into a variety of TECHNOLOGICAL INNOVATIONS that contain a tremendous amount of ECONOMIC LEVERAGE. Two examples might be FROTH FLOTATION CIRCUITS and “JUMBO” drill rigs.
Once TECHNOLOGICAL INNOVAIONS are deployed, then PRODUCTION RATES and EARNINGS can accelerate MUCH MORE RAPIDLY than back in the days when Auryn was in “bootstrapping” mode. Kevin made a comment several months ago how we’d all be shocked when Auryn is simultaneously mining “8 to 12” working faces at the same time. In retrospect, I think we’ll soon appreciate how SERNAGEOMIN’S signing off on the new ventilation/safety egress system, providing vast levels of SCALABILITY for production rates, was a huge CORPORATE ADVANCEMENT that, of course, “the market” yawned over. But that “yawn” might have been understandable because not many probably tied that accomplishment to the ability to rapidly ramp-up PRODUCTION RATES once production commenced.
These enhanced EARNINGS can then be allocated towards, what JimmyP described as, “RECALIBRATING THE SHARE PRICE” and unlocking the POTENTIAL ENERGY that has been building for all of this time during the “DISCONNECT” time period. Until a corporation can generate EARNINGS, then these “DISCONNECTS” are tough to deal with, and it’s like trying to generate traction while standing in quicksand.
Until you have EARNINGS and therefore EARNINGS PER SHARE, it’s tough to appreciate the benefits of all of that “bootstrapping” that Auryn did, in order to keep their number of shares issued and outstanding at only 70 million shares during the tough times. With only 70 million shares issued and outstanding (fully diluted) even a modest amount of EARNINGS can result in a very robust EARNINGS PER SHARE figure. Shareholder rewards are tied intimately to EARNINGS PER SHARE either via the share price trading at industry standard “multiples” of EPS (like 30.21 in the mining industry) or through CASH DIVIDENDS. Until Auryn had/has EARNINGS, this tremendous asset (a tiny number of shares outstanding) was only an ace up Auryn’s sleeve, that couldn’t be played yet. It was yet another form of POTENTIAL ENERGY.
THE CONCEPT OF BEING ABLE TO DECLARE AND DISTRIBUTE PROGRESSIVELY LARGER/MORE GENEROUS CASH DIVIDENDS OVER TIME
As production rates predictably ramp up, which Dr. Mischo recently predicted will happen when he stated: “once the most efficient recovery method is established (froth flotation), production scaling would be straightforward and highly effective”, management gains the ability to declare and distribute PROGRESSIVELY LARGER CASH DIVIDENDS over time. Picture a graph of “PRODUCTION RATE” as a function of Time, and how it is likely to stair-step upwards with each new sub level going into production or things like a “jumbo” drill rig are deployed. Each new sub level incrementally added will add 2 new mining “working faces” for crews to operate on.
“PLCDs”
If an investor knew that a corporate issuer had been able to achieve the ability to distribute a SERIES of PROGRESSIVELY LARGER CASH DIVIDENDS (PLCDs), “stair-stepping” upwards over time, and management clearly articulated that “PLCDs” were their intent, what might an opportunistic investor do? Let’s say that the quarterly dividend amounts were “X”, followed by “1.2X”, followed by perhaps “1.5X”, etc.
As an opportunist, what I would be tempted to do, would be to, once I read a press release stating this intent, buy as many shares as cheaply as I could afford to buy, BEFORE THE FIRST DIVIDEND “RECORD DATE” occurred. By law, management has to give investors a “head’s up” and state that the official “Ex-Dividend Date” for Dividend #1 will be, let’s say June 1, which means that all stock purchases that “cleared and settled” by June 1, would qualify for that first dividend.
The “extra” amount of shares that I bought prior to that dividend “ex-date” would be entitled to that first dividend distribution AS WELL AS ALL SUBSEQUENT PROGRESSIVELY LARGER CASH DIVIDENDS. Picture that as a “STREAM” of income. So too would be any shares I owned prior to that initial press release stating the Ex-Date for the first of many cash dividends. They would spawn another “STREAM” of income. THIS IS AN EXAMPLE OF A POSITIVE FEEDBACK CYCLE but it is a lot more explosive than just “COMPOUND INTEREST”. In a scenario like this, the DISCONNECT goes from being a negative to a positive i.e. an investor wants to buy shares priced at ridiculously low levels.
The share price is obviously going to go up if many OPPORTUNISTS were thinking along these lines. From a percentage of current share price point of view, the first dividend might be considered EXTREMELY GENEROUS because of the DISCONNECTED share price. But so too might be the second dividend of “1.2X” amount of cash.
Can you sense what might happen with time for the owners of those shares? They might become of the mindset, WHO CARES WHAT THE SHARE PRICE IS, BECAUSE I CAN ALWAYS TAKE MY DIVIDEND CASH AND (HOPEFULLY) BUY MORE RIDICULOUSLY PRICED SHARES AND EXPOSE THEM TO PROGRESSIVELY LARGER CASH DIVIDENDS (“PLCDs”) through time. It’s almost a refreshing concept to TEMPORARILY root for the share price to stay cheap for just a little while longer.
So, what do you have when you have the option to expose PROGRESSIVELY LARGER AMOUNTS OF SHARES to PROGRESSIVELY LARGER CASH DIVIDEND DISTRIBUTIONS? You have a POSITIVE FEEDBACK CYCLE. Note that the key is for management to be able to ramp up production rates throughout time. This is where that SERNAGEOMIN approval and the SCALABILITY it provided, factors in. Keep in mind that in the mining industry, it’s easy to ramp up production early on, but you need to remember that production rates tend to plateau out after several years of ramp-ups. Production GRADES will also tend to decrease after several years of production/”high-grading”.
Don’t forget the concept of OPTIONALITY in the mining industry. As the new sub levels are opened up, and if one of the new sub levels just happens to have atypically high GRADES or atypically wide vein widths, then Auryn has the OPTION to aggressively produce from that particular “super-rich” sub level. This is known as “HIGH-GRADING”.
Being able to open up new sub levels is both EXPLORATION and RAMPED UP PRODUCTION. The CIM standards and guidelines for blocking out MR/MR in a vein setting, permit the blocking out of many ounces of MR/MR through these “production developments.” Think of production adits as basically gigantic horizontal drill holes, from a 3-dimensional block modeling and wireframe generation point of view.
WHAT ARE THE CHANCES OF MAURIZIO SIGNING ON TO CASH DIVIDENDS? A WALK THROUGH MEMORY LANE
Do you remember what Maurizio stated in a press release back when the Larrissa Adit/Caren Mine/Merlin 1 Vein was anticipated to go into production? (This was the original plan, namely that the Larrissa Adit would commence production and then the DL2 Vein. This order later got reversed.). What Maurizio stated was that after one quarter of production, “the BOD would evaluate the appropriateness of declaring and distributing cash dividends”. Recently, in the 2/4/24 quarterly update, Maurizio cited the intent to “return value to our shareholders, reinforcing our commitment to stakeholder profitability”. “RETURNING VALUE TO SHAREHOLDERS” sounds a lot like cash dividends to me, but we’ll leave that up to management.
When management owns 60% of the shares issued and outstanding in a “semi-restricted” format due to Rule 144, “restricted shares” will still earn the same dividend as “free-trading” shares. I could easily see Maurizio passing down his shareholdings to subsequent generations, while enjoying the cash flow from the dividend distributions. Once you sell the shares, you’d lose out on the PROGRESSIVELY LARGER CASH DIVIDEND DISTRIBUTIONS those shares would have earned, from that day forward. This is a pretty powerful deterrent to selling shares for all concerned.
When you sell your shares, then you have a bunch of cash in hand and you need to decide what to do with that cash. Can you find another investment that is paying PROGRESSIVELY LARGER CASH DIVIDENDS through time? Maybe, maybe not. In the U.S., if you make less than $98,500 per year, then the distribution of “qualified cash dividends”, is tax free (unless the rules recently changed-ask your professional tax advisor). Here “QUALIFIED” means that you don’t back up the truck and buy a ton of shares right before an “Ex-Dividend Date”, only to “flip” them and sell them within 60 days. The IRS doesn’t like that and you won’t qualify for this PREFERENTIAL TAX TREATMENT FOR QUALIFIED DIVIDENDS.
Wealthy people don’t buy and sell securities as much as you might think. Many simply hold on for extremely long periods of time and when they need cash, they pledge their shareholdings against a cash loan and opt to pay a little interest, and therefore, in a scenario like this, continue to enjoy the PROGRESSIVELY LARGER CASH DIVIDENDS over time as well as their PREFERENTIAL TAX TREATMENT. I saw on last night’s news that Congress is contemplating increasing the CAPITAL GAINS TAX RATES. If this is done, there might be a lot of corporations choosing CASH DIVIDENDS to provide shareholder rewards. In a world of “DISCONNECTS”, can you see why CASH DIVIDENDS are looked upon as GUARANTEED SHAREHOLDER REWARDS. Capital gains are anything but “GUARANTEED” in markets with “DISCONNECTS”.
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IN CASE ANYONE MISSED IT! (in a mere 237 words)
What stands out to me is that after STOICALLY ENDURING months (years?) of taunts about his inability to have a conversation with AURYN management, Brecciaboy, just eight days ago, slipped a five-word LIGHTNING BOLT!!! into a 1,410 WORD post.
I confirmed with Maurizio yesterday....
– And THEN, ignoring someone’s comment about his verbosity, the VERY NEXT DAY Brecciaboy outdid himself with 1,772 words that basically said that EVERYTHING HE’D ALWAYS SUSPECTED AND DEDUCED ABOUT WHAT WAS GOING TO HAPPEN WITH AURYN AND MDMN was, in fact, ACTUALLY GOING TO HAPPEN! No telling exactly how soon, but DON’T LOOK AWAY FOR TOO LONG, FOLKS!! Exciting stuff, if you can believe it. Or was it just one more case of Brecciaboy getting overly worked up?
– Next he managed to go five straight days without posting another word, and then just two days ago (Brecciaboy must have been working 24-hour shifts on at least five faces in his own personal PORPHYRY of a high-grade word deposit) he delivered a whopping 5,214 WORD post filled with off-the-charts assays!
– And just an hour or two ago followed up with another 2,445 words!
DOES ANYONE ELSE SEE A DISCONNECT HERE? Between the jaded woe-is-me chitchat on this board and what MUST be going on behind the scenes?
A casual (but not disinterested) observer of AURYN/MDMN might be forgiven for getting a little EXCITED here. No?
– MADMEN (not disinterested)
[ LATER: I posted this before I even I took my first peek at the stock price, my first peek in many months. Nice day, percentage wise… ]
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Watching this show on Fox called American Gold the legend of Bear Gulch. Talks about underground mining. Pretty cool talks about getting water out of the mine, getting ventilation to get the bad air out of the mine and locating the gold veins High Grade and drill hole on the number 1 which is the face. Sound familiar?
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Very interesting article about what’s going on with Codelco and copper in Chile and elsewhere!
I apologize if you can’t access this- it’s very long and has charts, etc-
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I asked a couple years ago if anyone was following this show- no response. They haven’t had a new season in a couple years. I actually like the series- hope they hit it biggly.
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Been great! I highly recommend watching it.